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Tag: Oando

  • Oando, OER in $98m debt-for-equity swap

    Oando Plc and Oando Energy Resources have struck a debt-for-equity deal that would reduce the outstanding indebtedness of the latter to the former by $98 million.

    A regulatory filing obtained at the weekend that OER, the upstream member of the Oando Group, has converted equity of principal and interest totaling $98 million under the outstanding $ 1.2 billion facility agreement dated 10 February, 2014 with Oando Plc into equities for Oando.

    With this, $41 million of principal remains outstanding under the Oando loan and an aggregate principal amount of approximately $292 million remains available to be drawn under the Oando loan.

    OER issued 68.14 million units to Oando Resources Limited, a subsidiary of Oando Plc, as repayment of amounts outstanding under the Oando loan at a conversion price of C$1.57 per unit. Each unit consists of one common share of the company and one-half of one warrant to purchase an additional common share at a price of CAD$ 2 per common share up until 30 July 2016, a 24 month period from which the company closed the acquisition of the Nigerian upstream oil and gas business of ConocoPhillips.

    The terms of the units, other than the denomination of the conversion price and exercise price in United States dollars, have the same terms as the units issued to third party investors and Oando Resources on previous tranches.

    Prior to the completion of the conversion, Oando Plc owned, and exercised control or direction over, 677.96 million common shares, representing approximately 93.2 per cent of the issued and outstanding common shares.

    As a result of the conversion, Oando Plc currently beneficially owns, or exercises control or direction over, 746.11 million common shares, representing approximately 93.8 per cent of the issued and outstanding common shares.

    Where Oando decides to fully exercise these new warrants and warrants previously issued to it on previous tranches of the loan, Oando would beneficially own, or exercise control or direction over, 1.07 billion common shares, representing approximately 95.6 per cent of the company’s issued and outstanding common shares. However, Oando is restricted from exercising any warrants that would result in its ownership of the company exceeding 94.6 per cent.

    Meanwhile, amounts owing under the Oando loan in the future may be converted into units at one or more prices to be determined in accordance with the pricing mechanism earlier determined and made public on February 10, 2014.

    It should be recalled that OER recently concluded the acquisition of ConocoPhillips’ Nigerian oil assets.

  • Automedics: Intervention by Oando, others creating jobs

    Automedics: Intervention by Oando, others creating jobs

    Switching over to computerised auto repairs has been a challenge to many mechanics who find it difficult to repair modern vehicles. But Oando Plc has stepped in to bridge the gap. It plans to spend N100 million to train mechanics nationwide. This has opened a new vista of opportunities for vehicle repairers who are ready to embrace new techniques, writes ADEDEJI ADEMIGBUJI.

    For three weeks, Uche Callistus has been battling with a Toyota High-lander 2013 model which gear has a challenge. At his workshop at the Ladipo Mechanic Village, Matori, Lagos, sweat cascaded from his forehead, through his cheeks to his hairy chest, yet he has no clue as to what is wrong with the gear of the Sport Utility Vehicle (SUV).

    Using trial and error method, he felt he had eventually found the source of the gear problem, which has continually failed to transit from one level to the other, leaving the throttle to hoot while in motion.

    He called the car owner, Mr. Yemi Silver and told him that the gear had spoilt and that he would need to buy a new complete gear costing close to a million naira for the 2013 model of the car brand. Without pressing him further on his findings, Silver called some friends who use the same type of car. Within a twinkle of an eye, Silver asked Uche to fix the car back and headed straight to an automedics in Lagos recommended by his friend.

    According to reports, about 90 per cent of over 5,000,000 mechanics in Nigeria use “trial by error” method to diagnose the problems of automobiles. Their inability to understand the workings of new cars, which are automated and powered by new technology, the jobs of mechanics have become more complicated than ever before when compared to what obtained in the past. While failure to admit lack of knowledge of this automated cars, many of them rather than reject such jobs, out of pride accept knowledge and capability to the diagnose and fix such modern but end up wrecking more havoc.

    Automedics’ mobile repair is fast changing the face of business of automobile repair. The service which is a departure from old automobile repair, now brings to car owners comprehensive auto repair services that include car care services, general services, undercar services, brakes, heating and cooling services, electrical services, transmission services, electronic services, engine services, towing, quick lube services, and wheel balancing, among others.

    “The problem is that rather than go for training on new auto repair techniques, auto mechanics prefer to bury themselves in the cocoon of their workshops and consequently endanger lives of vehicle users with their guess diagnosis,” said the Chief Executive Officer of New Technology Auto, Mr. Kunle Badamosi.

    To stem the development, there are efforts by various organisations and groups to train mechanics on automedics. Oando Plc has announced plans to invest N100 miilion to train auto mechanics.

    With the investment, Oando said it is preparing mechanics  to repair and fix modern vehicles. It plans to train 1,000 mechanics selected from Nigerian Automobile Technicians Association (NATA) and Motor Mechanics and Technician Association of Nigeria (MOMTAN), in Lagos.

    The Head Marketing, Oando Plc, Mr. Babafemi Olabiyi, said  Oando Marketing is embarking on the project in collaboration with Automedics to train the 1,000 mechanics.

    Starting with 100 trainees from both associations that will  go through a three-week intense training on specialised fields, Olabiyi said the mechanics will not only be given technical knowledge but training on financing and customer relations.

    He said the auto mechanics became imperative following a survey carried out by the company, which exposed lack of modern day knowledge of mechatronics systems in general and skill deficiencies of the mechanics.

    He said: “The training of the 1,000 mechanics is therefore, part of our ongoing efforts aimed at providing solutions to the service and maintenance problems of high technology motor vehicles through the production of competent craftsmen who will be enterprising and self-reliant.

    “The emerging crop of vehicles imported into the country is made of highly sophisticated combination of mechanical and electronics parts, which the average roadside mechanics do not understand.”

    The Chief Operating Officer of Oando Marketing, Mrs. Olaposi Williams, said: “we have seen a gap in the system. In the past there used to be a lot of technical schools for training of mechanics and other professionals but that has dwindled. So we are partnering with Automedics who has the competence to train mechanics to empower them so that they can stand on their own to run mechanics industry properly using the right tools and the acquired efficiency and right products.”

    She assured that Oando is ready to partner with other organisations that bring similar ideas on the table in other to reach more mechanics and deepen job opportunities.

    The Chief Executive Officer of the school, Automedics, Kunle Shonaike, said the training will give Nigerian mechanics opportunity to make more money and serve automobile users better. Shonaike returned from United States in 2005 to establish the school.

    On his return, he observed the huge gap between Nigerian mechanics and US and decided to start the school to train more mechanics whom he said were repairing vehicles with ‘trial by error’ method especially when most technology of modern vehicles has gone digital and fully automated. As a result, he said the partnership with Oando to train the mechanics will go a long way in equipping the mechanics for their jobs.

    “Ever since I returned to Nigeria from the USA, where I was trained professionally and practiced for more than two decades, to start practicing in the backstreet of one of Lagos’ slums, Mushin, I knew one of my life’s main purposes would be to help transform the predominantly obsolescent culture of the industry by training the artisans who dominate the workforce,” he said.

    With the opportunities given to them, the Lagos State chairman of Automechanics and Technicians Association of Nigeria, Mr. Maruf Arowolo, advised the public to patronise mechanics that belong to the associations. He also urged members to embrace the opportunity offered by Oando to change the perception vehicle users have about them. Arowolo said this will restore confidence if his members embrace the new automobile repair approach.

    According to him, the training will increase quality of service, increase profit and make the job more professional.

    Also in Kaduna, Alhaji Abdullahi Salihu, the Chairman, Nigeria Automobile Technicians Association, Kaduna State Chapter, said 30,000 members of the association had been trained to use improved automobile technologies in their work.

    Salihu told NAN in Kaduna that 1,500 almajiri (pupils of local Islamic schools) had also been trained as auto mechanics this year. He said the use of improved technologies, such as computers in detecting faults in vehicles and replacing or repairing parts in cars, was a good development.

    “We are updating ourselves at every opportunity. Our members have been carefully selected and trained by some automobile companies, such as Peugeot, Toyota, Kia and Honda, in mechatronics.

    “The training is not limited to specific vehicles but comprise all sophisticated vehicles,” Salihu said.

    Meanwhile, Olabiyi said the training is part of effort to create alternative wealth for the mechanics. “We also have another strand which is alternative wealth creation. We have other business within the Oando business portfolio like our O-Gas portfolio that they can also leverage. So it is a well thought out programme that involves making them world class so that they can leverage emerging technologies to do their work better,” he said.

    The company, according to Olabiyi, is also extending the training to managerial skills. “It is not only technical aspect which includes advancement in technology, computer and auto diagnosis, it also involves managerial too in terms of relationship with their customers and in terms of small scale financing and how they relate with their banks,” he said.

    Meanwhile, an industry observer, Farouk Martins Aresa, believes there are greater opportunities for mechanics who embrace the new automotive repair technique. He said any mechanic that upgrades his skill will have a new window of opportunity.

    He said: “The fear is that very soon, the skills of our mechanics may be limited to old cars and older men and women that work on them. The new trainees may eventually lose out on the new automobiles to work on since most of them are not made in Africa. The skills needed to work on new cars may have to be imported as we import some constructions materials and technicians for roads, bridges and sophisticated high rise buildings.

    “Anambra and Lagos States have reformed the old dirty mechanics we used to know and many of them are taking courses to upgrade their skills in high tech auto plants. The same applies to Kaduna and Ondo States’ mechanics who are encouraged with new facilities, locations and training to also prepare them for the new technology. So, ultra-modern mechanic village was launched in Akure recently towards this goal.”

    An expert in automobile, Mr. Kudus Oyekunle who runs an automedic in Alagbado Lagos, said it cost about N400,000 to start up an automedic for small scale mechanics. He said a mechanic will only need to acquire a location to operate from, adding that going computerised in automobile repair is the real deal.

    On academic qualification that would be possessed by a beneficiary, the Lagos State Chairman of Automechanics and Technicians Association of Nigeria, Mr. Maruf Arowolo, said that beneficiaries must be members of any auto mechanics association but he explained that the associations have members that are university graduates. We have members that are well read, he added.

  • Oando edges ConocoPhillips’ acquisition with $550m deposit

    ando Plc, through its upstream oil exploration and production subsidiary, Oando Energy Resources (OER) Inc, has made a total deposit of $550 million to ConocoPhillips (COP), more than one-third of the $1.55 billion deal for the acquisition of COP’s Nigerian business.

    In the latest update on the landmark transaction, Oando indicated that it has also extended the availability period of the $450 million senior secured facility agreement arranged by a group of international banks including Standard Chartered Bank, BNP Paribas and Standard Bank of South Africa Limited to August 31, 2014.

    The facility is a five and a half years lending arrangement which amortises quarterly with an annual interest rate of LIBOR plus 8.5 per cent. Proceeds from the facility are intended to be used to fund a portion of the purchase price for the COP’s acquisition. All terms and conditions under the initial executed binding documentation remain unchanged.

    According to the company, it had increased its deposit with COP by $25 million to increase total deposits to $550 million.

    OER had reached agreement with COP to extend the outside completion date for the acquisition of COP’s Nigerian oil and gas business by Oando till June 30, 2014.

    A regulatory filing submitted to the Nigerian Stock Exchange (NSE) stated that the extension of the outside date for completion was necessary to enable the companies to satisfy all closing conditions including the anticipated consent of the Minister of Petroleum Resources in Nigeria.

    According to the filing, pursuant to an amendment agreement executed on April 30, 2014, OER and COP agreed to extend the outside date for completion of the COP acquisition from April 30, 2014 to June 30, 2014.

    Under the terms, OER also agreed to increase its deposit by $25 million on May 30, 2014, if the consent of the Minister of Petroleum Resources is not received on or before May 23, 2014.

    Oando had technically concluded the momentous acquisition as it pooled the final financial considerations to complete the $1.55 billion agreement with COP in January 2014. The completion of the financial considerations sealed the deal for Oando, although the two parties will still have to wait for the final approval by the Federal Government.

    In December 2012, Oando, through its subsidiary Oando Energy Resources (OER), entered into an agreement with COP to acquire COP’s Nigerian businesses for a total cash consideration of US$1.55 billion. Oando confirmed at the weekend that it has raised the balance of funds and attained financial closure for the deal, pending the approval of the government.

    Oando had made an initial deposit of $450 million to COP. It subsequently undertook many capital raising exercises through a combination of equity and debt including $200 million from a special placement of two billion shares, $100 million through the sale of its subsidiary East Horizon Gas Company and debt from financial institutions totaling $800 million.

    While Oando had duly completed all financial commitments regarding the acquisition, closing of the COP acquisition remains subject to satisfaction of closing conditions, including approval from the Minister of Petroleum Resources. COP was said to have already submitted an application to the Minister of Petroleum Resources to approve the transaction.

    Speaking recently during a visit to the NSE, group managing director, Oando Plc, Mr. Wale Tinubu, confirmed the financial closure and said the group’s acquisition of COP Nigerian assets would dramatically impact on the fortunes of the group going forward.

    According to him, Oando will more than double its pre-tax profit to some N100 billion as the integrated energy group looks to unlock immense potential of COP acquisition.

    He said with the conclusion of the acquisition of COP, Oando’s earnings before interest, taxes, depreciation and amortisation (EBITDA) will rise from the current annual average of N45 billion to N100 billion.

    He said the increase in earnings would also lead to improvement in dividend payout to shareholders going forward.

    He earlier noted that the audacious acquisition is a game changer for Oando as it will immediately position the company as the largest indigenous oil producer in Nigeria.

    “We are immensely pleased to have secured all funding to complete our. We are tremendously excited about the future of our organisation as this acquisition will not only provide significant growth in size and scale; but will substantially strengthen our position in the upstream sector,” Tinubu said.

    Oando through OER currently produces 4,500 barrels of crude oil per day from two producing fields, with this acquisition it will start producing circa 50,000 barrels per day from six producing fields.

  • Oando trains 5,000 mechanics

    Oando trains 5,000 mechanics

    Oando Marketing Plc is preparing to train 5,000 mechanics across the country on how to repair vehicles.

    The training is among its empower programmes to sustain its brands.

    The company said it would train the 5,000 mechanics selected from Nigerian Automobile Technicians Association (NATA) and Motor Mechanics and Technician Association of Nigeria (MOMTAN) in Lagos.

    Oando’s Head of Marketing Babafemi Olabiyi said the training would start with 100 trainees who would go through a three-week course on specialised fields. Olabiyi said the mechanics would not only acquire technical training but also knowledge on financing and customer relations.

    The company marketing chief said the auto mechanics were chosen following a survey carried out by the company, which showed a lack of modern knowledge of mechatronics among mechanics.

    He said: “The training of the 5,000 mechanics is part of our ongoing efforts at providing solutions to the service and maintenance problems of high technology motor vehicles through the production of competent craftsmen who will be enterprising and self-reliant.”

     

     

    “The emerging crop of vehicles imported into the country is made of highly sophisticated combination of mechanical and electronics parts, which the average roadside mechanics do not understand.”

     

  • FCMB leads Oando deal

    FCMB Capital Markets, the investment banking arm of the  FCMB Group, has emerged the lead arranger in the ConocoPhillips acquisition agreement signed by Oando Plc.

    The agreement signing and completion ceremony took place in France.

    FCMB Capital Markets Limited,  played the dual role of the Mandated Lead Arranger and Technical Bank, while First City Monument Bank Limited, its sister company, was one of the major lenders in the transaction, a statement from the lender said.

    The $1.65 billion deal, which is expected to increase Oando’s crude oil production from about 5,000 barrels per day to 50,000 bpd, was concluded following the satisfaction of all statutory requirements and approval of the Federal Government.

    “This acquisition satisfies our criteria for assets in production, as well as excellent appraisal and exploration prospects,” Wale Tinubu, Chairman, OER said.

    FCMB’s emergence comes as local banks are increasing their investment banking (IB) capacity to handle the most sophisticated deals. Three Nigerian firms –Vetiva Capital Managements Ltd, FCMB Capital Markets and FBN Capital finance – emerged in the top 10 lists for Sub-Sahara Africa Equity Capital Markets fee rankings for first half of last year, according to data from Thompson Reuters deals intelligence.

    Domestic firms are developing investment-banking capacity as deals explode in Africa’s largest economy, powered by an emerging middle class and rising consumer spending. Projected growth rates of roughly 7.1 per cent per year through 2030, would raise Nigeria’s total Gross Domestic Product to more than $1.6 trillion, making it a top-20 global economy, according to consulting firm, McKinsey, in a report released last week.

  • Oando pays $1.5b for ConocoPhillips’ assets

    Oando pays $1.5b for ConocoPhillips’ assets

    Oando Energy Resources Incorporated (OER), the exploration and production arm of Oando Plc, yesterday paid $1.5 billion for the acquisition of the divested ConocoPhillips’ upstream’s  oil and gas assets in Nigeria.

    The completion of the landmark transaction, acording to the firm, brings to a close the deal, which has been on the table since 2012, when ConocoPhillips’ announced it decision to pull out of its upstream operations in Nigeria.

    With the conclusion of the  deal, Oando becomes the owner of ConocoPhillips’ 20 per cent non-operating interests in onshore assets, including oil blocks in oil mining leases (OMLs) 60, 61, 62, and 63.

    Its ownership also extends to related infrastructure and facilities in the Joint Venture in which Nigerian Agip Oil Company Limited,  holds 20 per cent and the Nigerian National Petroleum Corporation 60 per cent.

    The related infrastructure and facilities include 40 discovered oil and gas fields, of which 24 are currently producing, 12 production stations, approximately 1,490 km of pipelines, three gas processing plants, the Brass River Oil Terminal, and the Kwale-Okpai 480 Mw combined cycle gas-fired independent power plant.

    Also, ConocoPhillips’ 95 per cent operating interest in OML 131 and 20 per cent non-operating interest in oil prospecting licence (OPL) 214, converted to OML 145 last month, will be fully  transferred to Oando.

    Other companies in the Joint Venture asset (OML 145) include ExxonMobil (20 per cent and operator), Chevron (20 per cent), Svenska (20 per cent), Nigerian Petroleum Development Company (15 per cent) and Sasol (5 per cent).

    Oando also said that through this transaction, OER will indirectly own all of the issued share capital of ConocoPhillips in Nigeria effective January 1, 2012, which translates to the date of the transaction.

    Oando said the total reserves and associated resources in the deal,  including proved, plus probable reserves, amount to about of 211.6 million barrels of oil equivalent (MMboe), adding that the transaction represents a significant opportunity for OER to create scale and significant value for its shareholders.

    It noted that OER’s sales production from the onshore assets, averaged 36,494 barrels of oil equivalent per day (boe/d) in 2013 and 39,266 boe/d in the first half of 2014.

    Oando said: “Upon completion of the transaction, OER will be positioned as one of the leading E&P players in the Nigerian oil & gas sector, as measured by end-2013 proved plus probable reserves of 230.6 MMboe.

    “The transaction was financed with an approximate 50/50 debt-equity ratio and is immediately cash generative and will contribute significantly to the cashflows of the company.

    “This transaction represents a transformational leap forward for our company and is in keeping with our overall strategy to grow our portfolio of Nigerian-based assets by focusing on those opportunities that deliver high quality growth in reserves and production,” said Pade Durotoye, Chief Executive Officer of OER.

    “Our management team is familiar with these assets and possess the managerial experience and technical expertise necessary to unlock their value for our shareholders,” he added.

    The Chairman, OER, Mr. Wale Tinubu, said: “We believe in the significant potential that the Nigerian oil and gas industry holds and are privileged to play a pivotal role in its consolidation, growth and development. We will continue to seek strategic opportunities that provide a platform for enhanced growth and value creation for our stakeholders.”

  • Oando screens Kunle Afolayan’s October 1

    Oando screens Kunle Afolayan’s October 1

    Kunle Afolayan’s new movie, October 1, may still be in post-production stage, but it is already getting demands from corporate organisations, with a view to sealing sponsorship deals.

    Touted as one of the best films by a Nigerian director, Afolayan has continued to seek funds to complete the movie. “We still need funds to complete the movie; what we are showing is not the final cut,” he told The Nation.

    At the Eko Hotel and Suites, last night, where the movie was screened exclusively for top executives of Oando Group Plc., and the company’s clients, the event was a show of class for Oando, which staged the preview session for its high network of clients.

    This is the second time the movie was enjoying a private preview, the first being on May 18, when it attracted top shots like Waheed Olagunju, Executive Director, Bank of Industry; Segun Awolowo, CEO, Nigerian Export Promotion Council; Akin Salami, CEO, OHTV; Mo Abudu, CEO, EbonyLife TV; Francois Sastourne, Consul General of France; and Mokgethi Monaisa, Consul General of South Africa, at the Intercontinental Hotel, Victoria Island, Lagos.

    The filmmaker is optimistic that more private screenings will be done for the movie, as a way to garner sponsorships for premieres in major cities in Nigeria and abroad.

    Asides the huge publicity for the film, interest from the business community started when in December 2013, the movie won ‘Best Fiction Trailer’ at the International Movie Trailer Festival. The award came with a price of $250 and Afolayan saw it as a great way to end year 2013: “I’m happy about this award. It’s not about the money, but the recognition of the hard work, the efforts of the cast and crew of October 1. It is a pointer to the fact that the film has great potentials to go places when it is eventually released,” he said.

    Already, plans are ongoing to unveil the film at a world premiere at the Toronto International Film Festival (TIFF), Canada, same way that Biyi Bandele’s Half of a Yellow Sun was first shown last September. The filmmaker is targeting October for its release date in Nigeria, obviously in tandem with the title of the film.

    October 1 is a psychological thriller set on the verge of Nigeria’s independence in 1960. It tells the story of a police detective in Northern Nigeria, who is dispatched to a trading post in Western Nigeria to solve a series of horrific murders. The movie stars Sadiq Daba, Kehinde Bankole, Kayode Olaiya, Nick Rhys, Fabian Adeoye Lojede, Kunle Afolayan and Demola Adedoyin.

  • Oando gets govt’s approval for $1.65b ConocoPhillips’ acquisition

    Oando gets govt’s approval for $1.65b ConocoPhillips’ acquisition

    The Federal Government yesterday approved the landmark acquisition of ConocoPhillips (COP) Nigerian assets by Oando Plc, paving the way for the final closure of the $1.65 billion acquisition deal.

    The much-awaited consent of the Minister of Petroleum Resources sealed the deal for Oando and sent investors scrambling for the shares of the leading indigenous integrated energy group. Oando’s share price rose by 7.99 per cent to close at N25 per share at the Nigerian Stock Exchange (NSE). Oando was also the most active stock as investors staked N992.9 million on 39.37 million ordinary shares of the company. Most analysts said they expected the price rally to continue in the days ahead.

    In December 2012, Oando, through its exploration and production subsidiary, Oando Energy Resources (OER), had entered into an agreement with COP to acquire its Nigerian businesses. Though Oando successfully acquired all funds required to complete its acquisition of the assets, closing of the COP acquisition had remained subject to the satisfaction of certain closing conditions, including government and regulatory approval, and the consent of the Minister of Petroleum Resources.

    Ministerial consent is the mandatory final approval of all oil and gas acquisitions by the  Minister of Petroleum Resources as required by the Petroleum Act of 1969 which states that “prior consent of the Minister of Petroleum Resources is obtained before the assignment of any right, power or interest in an oil prospecting licence or oil mining lease”.

    The Act stipulates that the Federal Ministry of Petroleum Resources must conduct due diligence to ensure ownership is being transferred to a company that is of good reputation, has sufficient knowledge, experience and financial resources to work the license or lease and in all other respects is acceptable to the Federal Government. Consent of the Minister may only be granted where the Minister is satisfied that the above conditions have been fully met.

    With the due completion of the game-changing acquisition, Oando would be immediately positioned as the largest indigenous oil producer in Nigeria and would now produce circa 50,000 barrels per day from six producing fields and will significantly impact its near immediate Upstream strategy and operations, and optimise its value across the energy chain.

    As it  awaited the government approval, OER had reached agreement with COP to extend the outside completion date for the acquisition till June 30, 2014.

    In a statement, OER stated that it would now work with ConocoPhillips towards completing the acquisition by the long stop date of June 30, 2014 or shortly thereafter.

    “Further to the receipt of consent of the  Minister of Petroleum Resources, OER and ConocoPhillips are now positioned to complete the ConocoPhillips transaction,” OER stated.

    As it awaited the ministerial approval, Oando had made a total deposit of $550 million to COP, one-third of the $1.65 billion deal while it has already amassed the funds needed to close the transaction. Oando last weekend secured extension of the availability period of the $450 million senior secured facility agreement arranged by a group of international banks, including Standard Chartered Bank, BNP Paribas and Standard Bank of South Africa Limited to August 31, 2014.

    The facility is a five and a half years lending arrangement which amortises quarterly with an annual interest rate of LIBOR plus 8.5 per cent. Proceeds from the facility are intended to be used to fund a portion of the purchase price for the COP’s acquisition. All terms and conditions under the initial executed binding documentation remain unchanged.

    It had also undertook many capital raising exercises through a combination of equity and debt including $200 million from a special placement of two billion shares, $100 million through the sale of its subsidiary East Horizon Gas Company and debt from financial institutions totaling $800 million.

    Commenting on the approval, the Group Chief Executive, Oando Plc, Mr Wale Tinubu, said the company would immediately complete the acquisition

    “We are delighted to receive the approval of the Minister of Petroleum Resources for the completion of our acquisition. It has been a long journey, wherein we kept faith with our strategy and executed every milestone diligently. This acquisition satisfies our criteria for assets in production, as well as excellent appraisal and exploration prospects. We will work hand in hand with the management team of ConocoPhillips to immediately complete the acquisition,” Tinubu said.

  • Oando unveils lubricant’s television commercial

    Oando unveils lubricant’s television commercial

    The Televison Commercials (TVC) unveiled by Oando Marketing, a subsidiary of Africa’s largest indigenous energy solutions provider, Oando Plc, is aimed at promoting Oleum, its flagship lubricant brand, Soyinka, its Head of Marketing Communications, has said.

    Speaking at a parley in Lagos, he noted that the TVC, titled: ‘The history’ is the first product-based commercial by Oando Marketing to promote Oleum.

    He said the firm used various advanced film making technology in producing the TVC because it was keen at demonstrating the advanced technology behind the product and “that was why we settled for a TVC that in itself showcases so much in technology”.

    He added that the TVC highlights advanced formulation and cutting edge technology as key ingredients in producting the premium lubricant, demonstrating that Oleum goes through a rigorous process to emerge as ‘The Master Engine Oil.’

    Lubricant Technical Manager, Oando Marketing, Mr. Abayomi Odetola said lubricants are highly technological products with expertise. He said lubricants, which represent a key part of Oando Marketing’s businesses, are manufactured to the highest international standards at all the firm’s ultra-modern lubricant plants in Nigeria.

    “Besides our other lubricant plants, we also have a brand new one in Lagos, which is the most modern lubricant blending plant in West Africa. The combined capacity of our plants is more than 150 million litres,” Odetola said.

    He further said Oando Marketing is a high performing fir, which believes in giving the highest quality lubricants to customers.

    He said: “We partner with some of the world’s biggest technology oriented companies in making our lubricants. This is why we are able to pass all the relevant tests required by the American Petroleum Institute (API), the highest body in the world for the certification of engine oil. In addition, our quality assurance process is very robust. All these are done so that the consumer can have peace of mind after buying any of our lubricants. Oando is reliable and responsible.”

    Soyinka said Oando is unique. “And so, we didn’t want a run-off-the-mill TVC; we wanted something very relevant and appealing but distinctively different,” he added.

     

  • Oando foresees brighter future with new acquisition

    Oando Plc will more than double its pre-tax profit to over N100 billion following it acquisition of ConocoPhilips (Cop) Nigerian assets.

    Its Group Chief Executive, Mr. Wale Tinubu, said Oando’s post-acquisition earnings before interest, taxes, depreciation and amortisation (EBITDA) would rise from the annual average of N45 billion to N100 billion.

    He said the increase in earnings would lead to an improvement in dividend payout to shareholders in the near term and enhance the company’s growth initiatives.

    “While Oando has concluded financial considerations for the $1.55 million acquisition, due process in the form of regulatory approval is required to officially close the deal. All we require now is the consent of the minister, which is the legal requirement. The transaction will not be fully consummated until the minister’s consent is received.”

    The assets acquisition will be a game changer for Oando, as it will position the company as the largest indigenous oil producer in Nigeria. Oando, through Oando Energy Resources (OER) produces 4,500 barrels of crude oil per day from two fields, but with this acquisition it will start producing about 50,000 barrels per day from six fields.

    Tinubu said: “We are excited by what the future holds for our organisation, as this acquisition will not only provide significant growth in size and scale, but also strengthen our position in the upstream sector.

    “Oando embodies a multifaceted approach, and we aim to maintain our dominant positioning in the midstream and downstream sectors, but this acquisition holds unprecedented opportunities for our upstream business.”

    He also explained the rationale behind the company’s proposed N250 billion capital raise as a fresh capital-raising basket that would provide flexibility to aid growth plans in the medium term.

    “The Rights Issue process will commence immediately after the Oando extraordinary general meeting (EGM) on February 18, and conclude in the first half of the year. Proceeds from the raise will be used primarily to lever the group’s balance sheet, which is a long-term goal of management and replenish its working capital, which was used partly to fund OER’s CoP acquisition.

    “As we mature, we seek to optimise our balance sheet with the view of releasing additional value to shareholders, through debt refinancing, asset sales and equity raises,” he said.

    Oando has experienced exponential growth in its asset base since 2003 (N36billion) to (N515billion) in 2013 due to the diversification efforts from its maiden Downstream business that was acquired in the early 2000s to the fully integrated platform with major assets in the Midstream and Upstream.